According to January 2023 data, Canada’s hotel performance dipped slightly from December 2022, but is up from 2019 comparables.
That is data from STR, which also found that in January 2023, occupancy was up 0.3 per cent, the average daily rate up was up 14 per cent and the revenue per available room was up 14.2 per cent.
“Canada’s hotel industry started off the year on a high note, as performance came in above the 2019 benchmark,” said Laura Baxter, CoStar Group’s director of hospitality analytics for Canada. CoStar Group is the parent company of STR. “Despite downward pressure on household disposable incomes, tourism spending remained elevated. People have chosen to prioritize experiences, including hotel stays, evidenced by transient demand that was 9 per cent above the pre-pandemic comparable and showed no signs of pullback from the latter half of 2022. Meanwhile, group demand came in 14 per cent below 2019 levels but is expected to pick up momentum throughout the year as more typical patterns start to emerge and the industry benefits from events taking place that were cancelled earlier in the pandemic.”
Across the country, Manitoba recorded the highest January 2023 occupancy rate, which exceeded pre-pandemic levels by close to 21 per cent. Prince Edward Island recorded the lowest occupancy rate, which was still up 14 per cent when compared to 2019 numbers.
“Typically, room demand declines in a recession, but STR’s latest forecast projects growth in 2023 with further demand rebound across all segments expected to push occupancy in line with the 2019 benchmark,” said Baxter. “The assumption that Canada will enter a moderate recession this year remains consistent, with GDP contracting 1.3 per cent. The bulk of ADR recovery took place in 2022, but with the industry laser-focused on the benefits of strong room rates, the forecast is set for the metric to remain ahead of 2022.”